Boohoo full-year sales and profits soar in ‘great’ year

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Boohoo has reported a strong rise in its preliminary sales and profits as boss John Lyttle said the coronavirus pandemic had highlighted the “key strengths” of the business.

The fashion etailer posted a 54% jump in pre-tax profit to £92.2m in the year to February 29, driven by a 44% revenue to £1.2bn.

The online retailer said since the coronavirus pandemic took hold in the UK, its trading performance had been “mixed” with “a marked decrease” in sales in mid-March.

Boohoo added that “performance has improved in more recent weeks and we are now seeing improved year-on-year growth of group sales during April”.

As a result of the ongoing uncertainty, Boohoo said: “It is not appropriate to provide guidance for the financial year ending 28 February 2021 at this stage.

“The group has taken steps to understand, as far as possible, the risks and impact that the pandemic may potentially have on its operations, analysing a range of scenarios, factoring in a downturn in demand and the possibility of warehouse closures. Although it is not possible to predict precisely the impact of Covid-19, we have ensured that we have stress-tested our liquidity under these scenarios.”

It added that the business has “sufficient financial headroom” to weather these various possibilities.

The fashion retailer also said it was “continuing to pay [suppliers] promptly” and had set up an emergency fund to provide support for those struggling during the pandemic. The retailer said that the vast majority of its office teams were now working remotely and that it was in “constant contact” with its warehouse teams, who have “adapted to completely new ways of working to ensure that they abide by all the social distancing procedures that we have in place.”

Boohoo posted strong revenue growth across all its territories in the year to February 29, with UK sales up 39% and international up 51%. The fashion etailer’s international revenue comprised 45% of the group’s overall sales during the period, up from 43% the previous year.

The number of active customers for Boohoo.com rose 28% year on year to 8.9 million.

Gross margin fell 70bps year on year to 54%, which Boohoo attributed to bedding in the new brands it had bought during the year including Karen Millen, Coast and MissPap.

Lyttle said: “Whilst recent events have understandably overshadowed what has been a great year for Boohoo, they have also highlighted its key strengths. Our business is founded on our ability to be agile and flexible and it is at times like this when these abilities are tested, and I am proud of how our colleagues and business partners from around the world have responded to the challenges posed by this pandemic.

“Although there is near-term uncertainty in the markets that we operate in, the group is underpinned by its incredibly strong balance sheet and is well-placed to leverage its scalable multi-brand platform and to continue to disrupt fashion markets around the world.”